The recent telephone caller to the New To Las Vegas world headquarters said his name was Jake Williams. He was soliciting a contribution to the Childhood Leukemia Foundation, a charity based in far-away Brick, N.J.
Okay, I said, how much of what’s raised is spent on fundraising? The excited reply: “Fifty percent to the foundation after fundraising!” This was not a direct reply to my question, which asked for the amount of fundraising expense rather than what’s left over. But it was the mathematical equivalent of saying the fundraising efficiency ratio–the percent of donations remaining after subtracting fundraising costs–was 50%.
As I will explain below, that’s not a great percentage. But for CLF it’s not even close to the truth, based on its very own latest available financial filing, submitted under oath. The actual percentage easily calculated from the filing: 21%. Put another way, 79 cents of each donated dollar went right out the door in fundraising, leaving the foundation with only 21 cents of each dollar for the stated mission and other overhead.
I also will explain below why I think the response was so off it might have violated Nevada law and constituted an actionable deceptive trade practice.
Now, I admit I followed that old trial lawyer trick of not asking an important question I don’t know the answer to. With Jake Williams–probably a computer-generated voice controlled by a human supervisor using soundboard technology–this was ridiculously easy to do. You see, CLF and I have a history together going back to BC (Before Covid). CLF’s financial efficiencies haven’t gotten better. In 2019 after being solicited two times on the phone I twice wrote up CLF’s poor financial efficiencies and other deficiencies. (You can read the posts here and here.) The second time, I even made CLF a candidate for my list of America’s Stupidest Charities. The criteria is simple: fundraisers that call asking for a donation despite a previous critical post by me. In that line of work, how much dumber can it get? You can find the list of nominee nearby. I don’t have to update it today with CLF because it’s already listed.
Let’s walk together through the numbers, plus some other issues. Continue reading